Disney's Iger On ESPN: We'll Disrupt When We Damn Well Feel Like It
from the worldwide-leader-in-denial dept
Last year, Disney stock took a repeated beating as Wall Street started to realize the company wasn’t faring particularly well in the face of Internet video revolution. Tens of billions in stock value instantly evaporated as investors learned that ESPN had lost 7 million customers in just the last two years. Evidence suggests this was largely thanks to the fact that ESPN leadership was utterly oblivious to the cord cutting and cord trimming trend, or the fact that a growing number of customers (the majority, in fact) are simply tired of paying for a channel they don’t watch, yet pay an arm and a leg for.
To try and soothe nervous investors, Disney and ESPN executives have been making the rounds lately in an attempt to “change the narrative” on cord cutting (read: pretend the company wasn’t caught with its pants down). ESPN Boss John Skipper, for example, recently admitted the company is seeing subscriber losses due to users shifting to so-called “skinny” bundles, but tried to argue these were older users the company didn’t really want anyway.
This week, Disney CEO Bob Iger is the one making the rounds, though you may not be able to hear what he’s saying over the sound of his own denial:
“The notion that either the expanded basic bundle is experiencing its demise or that ESPN is crating in any way from a [subscribers] perspective is just ridiculous,? Iger said at one point. ?Sports is too popular.?
But despite what Iger thinks, ESPN is not synonymous with sports, and cratering under the load of an evolving market is exactly what’s happening. For decades, ESPN enjoyed being part of channel bundles that generated revenue regardless of whether or not consumers actually watched it. As the traditional cable bundle gets broken up, ESPN’s faced with the fact that 56% of cable users no longer want to watch the channel if it means saving a little money. In response, ESPN’s trying to sue companies trying to give consumers what they want, a losing proposition long term.
As alternative streaming options rise, ESPN subscribers will dip, and the company’s long-term (and hugely expensive) sports programming deals are going to start feeling very heavy. ESPN could try and offer a direct streaming service, but with dropping subscribers and soaring programming costs, the numbers aren’t very pretty. Just don’t point any of this out, or, like pay TV analyst and frequent ESPN critic Richard Greenfield recently found out, certain media outlets may decide to set you on fire in the Hollywood town square.
Like so many legacy industries used to revenues they haven’t actually had to earn in years, it’s pretty clear that Iger believes that ESPN is the one that gets to decide when it gets disrupted and when it has to dirsupt:
“We?re not going to sit back and let the disrupters just disrupt,? Iger said. ?We?re going to participate in some of that disruption. And we?ll decide when the time is right to be more disruptive than we have been if we really think the business model is shifting rapidly. So far we do not see that.”
Like most people, ESPN execs see what they want to see. Wall Street now sees it, which is why Iger’s flapping his arms and doing this particular chicken dance in the first place. It’s all part and parcel of the cable and broadcast industry’s sincere belief that the legacy cable TV cash cow is going to live forever — so they really don’t have to rush to adapt — or compete on price — any time soon. But years of denial and inflexibility are starting to catch up with executives mentally stuck in the late nineties, and if 2015 was any indication, 2016’s going to demolish any lingering fantasies.
Filed Under: bob iger, disruption, espn
Companies: disney, espn
Comments on “Disney's Iger On ESPN: We'll Disrupt When We Damn Well Feel Like It”
One and a half out of five
“We’re not going to sit back and let the disrupters just disrupt,” Iger said. “We’re going to participate in some of that disruption. And we’ll decide when the time is right to be more disruptive than we have been if we really think the business model is shifting rapidly. So far we do not see that.”
From the sound of it while they’re still mostly stuck on the first stage of acceptance, denial, they might be ever so slowly moving along and have finally reached stage two, anger. If they can get through the next two, bargaining and depression and move on to the last step, acceptance in time they might be able to salvage enough to not be completely left in the dust, though I wouldn’t put high odds on it given how long it’s taken them to reach step two.
Re: One and a half out of five
Honestly, his arrogance says they may be a bit too late to react when they do. See how he talks as if disruption can be controlled?
This is not anger, it’s full denial.
Re: Re: One and a half out of five
I see little difference between denial and blind anger, at least in the results.
The issue will be in the mitigation of their grief over all that money no longer flowing so easily into their pockets. With stances taken in such a way that backing down will be nigh on impossible, or at least terribly terribly embarrassing, and administration changing.
Let us hope that velocity increases on this downward slope and that terminal velocity, when achieved, is as messy as it sounds.
Disney & Iger
“Iger’s flapping his arms and doing this particular chicken dance in the first place. ”
One of the best lines I have ever read!!!!!
Re: Disney & Iger
“Iger’s flapping his arms and doing this particular OSTRICH dance in the first place.”
There, fixed it for you.
Re: Re: Disney & Iger
I really hate the whole “fixed that for you” nonsense. That needs to die with Slashdot.
Re: Re: Re: Disney & Iger
“I really hate the whole “fixed that for you” nonsense. That needs to die with Usenet.”
FTFY, HTH, HAND
We’re not going to sit back and let the disrupters just disrupt LOL
I love that line. I seriously do. Like they think they have a choice in the matter.
Guess what, ESPN? You have 2 things which anyone actually wants to watch anymore: live sports (which aren’t making you a whole lot since you have to pay a ton for those rights) and PTI (which you’ve unsuccessfully tried to copy so many times it’s not even funny and you’ve bogged down with so many commercials, it’s basically unwatchable at this point).
All your talent is fleeing like rats from a sinking ship.
You aren’t going to be disrupted, you’re going to be out of business. Have fun with that, Skipper.
Re: We’re not going to sit back and let the disrupters just disrupt LOL
This part they actually do have a choice in the matter. They can participate. It the next line that is delusional
“And we’ll decide when the time is right to be more disruptive”
Ok, you can decide when you want to participate alright, but if you don’t decide to start yesterday, you are deciding to “sit back and let the disruptive just disrupt”.
How much cheaper would SlingTV be if ESPN wasn't part of the default package?
Sling is ~$20/mo for base channels, which include ESPN/ESPN2. I don’t watch either channel, and would love the opportunity to drop both. They could move the ESPN channels to the Sports Extra lineup…since if you like sports, you’ll likely buy the sports extra lineup for $5/mo anyway. My guess is that if they dropped ESPN, or better, went a la carte and just charged you for what you wanted, the price would be less for their customers who didn’t want ESPN, who could spend that money on channels they did want.
I realize that Sling is Cable-Lite, I went cold turkey for years off of cable, but found myself coming back just for a few channels I really liked…really wish they had Discovery, but they could make it even more cable lite by going a la carte, which is why it will never happen.
Re: How much cheaper would SlingTV be if ESPN wasn't part of the default package?
but they could make it even more cable lite by going a la carte, which is why it will never happen.
Oh but it will happen. It’s just that a few channels (or producers) will drown under the wave.
“And we’ll decide when the time is right to be more disruptive than we have been if we really think the business model is shifting rapidly.”
…and presumably you’ll join the others on the scrapheap of history who waited too long to realise what was happening, and get left so far behind that it’s impossible to regain lost ground before you’ve even started moving.
Somebody’s living in Fantasyland.
Just me?
Is it just me, or does that read like someone who’s just leant a brand new buzz-word that everyone’s telling him is important, but he’s not quite sure what it means?
Disruption?
I don’t think that word means what Iger thinks it means.
none of the entertainment industries, including Hollywood, have admitted to anything changing at all! the biggest problem there is that politicians in Congress and the legal system have done/are doing whatever they can think of on top of what the industries tell them to do, just to keep them, not in the late 90s but in the late 50s-60s and every year since! and what makes it worse is the fact that apart from continuously moaning and decrying what every other industry should be doing to help them out, the industries themselves are doing absolutely nothing to join the present with all it’s advantages!!
Listen up Bob
First, there are innumerable other sources of entertainment available for everyone other than sports these days. 20 years ago, most people were restricted to home video (VHS), television, movies, and (in a much smaller percentage than today) video games. With the internet and gaming being so much more accessible and widely appealing, you’re competing a lot more for people’s attention than you ever had to, and you are bloody well losing…badly.
Second, I don’t think as many people like sports as you think. I’m a big NFL fan, but that is 4 months of sports I watch, and that’s it. I suspect quite a high percentage of sports fans are 1, maybe 2 team fans. That does not necessitate a 24-7 sporting news (I use news loosely here) cycle.
Third, people are getting really sick and tired of subsidizing shit they don’t use in entertainment across the board. Notice the decline of the album in music sales now that a la carte track choices are for the most part ubiquitous. TV has a long way to go, and it’s going to be painful.
Expect the bleeding to continue.
ESPN is not synonymous with sports
while that is certainly true, another, less obvious, trend may be developing.
years ago sports was considered wholesome, and a continuing narrative on the face of it seems hidebound to preserve that particular charade. problem is, though, sports is a festering sore on the butt of society, and a constant drumbeat of ugly stories keeps reminding us of it.
beginning especially with the monstrous penn state horror story and continuing such places as baylor and others, college sports is developing a terrible reputation. what happens when the public gets its fill of that? what happens when the awful stories from pro sports and college sports overwhelms the paint and lipstick and people start to see athletics for what it really represents?
Australia (Again)
Sports channels, including ESPN, have been available as an optional add-on pack in Australia for roughly 10 years. Do you know why? The biggest question Australian subscription TV customers had was “Can we please save money by dumping the sports channels?” and after 10 years of “No” they decided the answer should be “Yes” and thousands of people around Australia were suddenly saving $20 per month from the already over the top fees Australia pays. Yay us! A big corporate bastard decided to do something right for the customers!
Re: Australia (Again)
Sadly, you folks still have King Rupert fucking things up royally down there and in the ‘States. The shill infotainment at Fox News makes a test pattern seem worthy of an Emmy.
Clarification required
I have to ask: what percentage of cable users are – or were – never interested in their product at all and never viewed it at all, but got counted as “subscribers” because they had no choice if they wanted any cable TV?
I know that’s the boat I was in before I finally cut the cord a few years ago.
"We’re not going to sit back and let the disrupters just disrupt,”
Here’s his true feelings in a nutshell. If there’s a problem, it must be because someone is out to get us, a kind of TV terrorist, and we must snuff them out. Yeah, that’s it, all we have to do is find these guys and take care of them. Let me look through my pockets for the right lawmaker to tend to the details. That’ll fix it, and my stock options too.
football
NBC has Soccer, don’t need ESPN
Disney is crap. All they do now is recycle their previous IP and gobble up other companies to add more IP to their portfolio (like ESPN) and bloat the Mausreich even further than it already is. Even their kids’ movies are loaded with annoying political messages about feminism (Frozen), race relations (the latest Star Wars), and whatever else the high-roller filmmakers persuade the lobby-minded executives to let them push on impressionable minds.
It’s because of their big-money buyoff of Congress that a stupid mouse belongs to a dead guy encased in carbonite until hell freezes over. Disney contributes nothing but remakes of their old products (Pixar version of Cinderella? Seriously?) and infinite cash to politicians.
I for one hope viewing audiences cut whatever cords they have to so that crooks like Iger and hacks like Abrams get the message. Disney shouldn’t be too big to fail. It’s already creatively bankrupt, one hopes that at some point it ends up financially so out of its own arrogance and greed.